Correlation Between Air Lease and Broadstone Net
Can any of the company-specific risk be diversified away by investing in both Air Lease and Broadstone Net at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Air Lease and Broadstone Net into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Lease and Broadstone Net Lease, you can compare the effects of market volatilities on Air Lease and Broadstone Net and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Air Lease with a short position of Broadstone Net. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Lease and Broadstone Net.
Diversification Opportunities for Air Lease and Broadstone Net
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Air and Broadstone is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Air Lease and Broadstone Net Lease in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Broadstone Net Lease and Air Lease is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Air Lease are associated (or correlated) with Broadstone Net. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Broadstone Net Lease has no effect on the direction of Air Lease i.e., Air Lease and Broadstone Net go up and down completely randomly.
Pair Corralation between Air Lease and Broadstone Net
Allowing for the 90-day total investment horizon Air Lease is expected to generate 1.25 times more return on investment than Broadstone Net. However, Air Lease is 1.25 times more volatile than Broadstone Net Lease. It trades about 0.04 of its potential returns per unit of risk. Broadstone Net Lease is currently generating about 0.03 per unit of risk. If you would invest 3,693 in Air Lease on August 24, 2024 and sell it today you would earn a total of 1,287 from holding Air Lease or generate 34.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Air Lease vs. Broadstone Net Lease
Performance |
| Timeline |
| Air Lease |
| Broadstone Net Lease |
Air Lease and Broadstone Net Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Lease and Broadstone Net
The main advantage of trading using opposite Air Lease and Broadstone Net positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Lease position performs unexpectedly, Broadstone Net can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Broadstone Net will offset losses from the drop in Broadstone Net's long position.| Air Lease vs. Alta Equipment Group | Air Lease vs. McGrath RentCorp | Air Lease vs. Herc Holdings | Air Lease vs. HE Equipment Services |
| Broadstone Net vs. Armada Hflr Pr | Broadstone Net vs. Brightspire Capital | Broadstone Net vs. Safehold | Broadstone Net vs. Essential Properties Realty |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
Other Complementary Tools
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |